We Weren’t Complete Babbling Idiots

Had lunch with Tim McAdam of Trinity Ventures. I have known Tim since we were both working in Chicago. When I met him, he was with a private equity firm GTCR that made real investments – say a nice $100 mil – in a variety of industries. I had nowhere near as cool a job: I ran a consulting company (Forgive Me for My Sins). Tim moved to California several years ago and is a very solid software VC on Sand Hill Road, epicenter of the venture community. Anyway I like guys from Chicago. Large plates of food, sporting events, huge quantities of beer, and honesty tend to have the right priorities with Chicagoans.

I was intrigued by what Trinity’s investment in still-stealth Wikisphere was all about. It seems the company will create an infrastructure for business communities. Think forums. Vertical Net redux, I ask? Close enough it seems. In the absence of knowing any details, this seems like a logical or inevitable use of wiki technology.

Although there has been inflated talk of VCs rummaging through dumpsters full of businesses plans from 1999, it is clearly happening as Wired’s Josh McHugh detailed nicely with his Mayfield Fund story, “Would You Buy a Used Dotcom from this Man?”. Perhaps somewhat dramatic in describing Mayfield’s “forensic analysis… to extract the good ideas trapped in the pile of dotcom corpses.” But not really. It makes sense if you think about it.

Yet how apropos. For here I am enjoying my omelet at Buck’s restaurant in Woodside which McHugh aptly calls “ground zero” for VCs. I am across the table from a Sand Hill VC, and money is flowing into the Internet, ladies and gentlemen. The crystal clear sun is shining outside on this great California day, and gee whiz, perhaps we weren’t all babbling idiots during the Boom. Crappy investors, yes. Out of control, yes. Drinking our own bathwater, check. But surely not babbling idiots. Oh no.

Because hidden in that nuclear winter that started March, 2000 were some perfectly fine ideas that were executed with some stupid combination of: a) spend money too fast, b) ignore margins, let alone spell the word, c) take money from any willing dope, d) get caught with our pants down in the spring of 2000 when the first payload of bombs hit. So many ideas were gushing out of the ground in ’98 and ’99 from reasonably highly educated people that some had to have been valid.

Business communities using wikis. On the surface: total sense. Reasonable business concept using contemporary, lightweight technology.